The COVID-19 pandemic is having detrimental effects on businesses and economies around the world. State governments are ordering nonessential businesses to close. Bars and restaurants are limiting services. Public schools are closed. Travel has slowed to a crawl. Consumers hunkered down in their homes — out of fear or government mandate — aren’t frequenting their favorite restaurants or giving into impulse shopping at local retail shops.
The Forrester B2C marketing research team is actively tracking consumer behaviors as a result of the COVID-19 pandemic. IRI published a COVID-19 data and insights dashboard that tracks the daily impact of COVID-19 on consumers and the consumer packaged goods (CPG) and retail industries. The numbers are staggering: Hand sanitizer purchases in the US increased 454% over the past week, and household cleaning products in the UK increased by 101%. Quantum Metric, a digital commerce vendor, noted that online sales have increased by 52% compared with the same time frame a year ago. Amazon and Walmart are on hiring sprees as a result of consumer demand increases. On the flip side, other industries are taking massive hits. Retail sales overall fell 0.5% in February, the largest drop in more than a year. Hotel and airline bookings continue to drop: Revenue per available room, a key industry metric, fell 32.5% to $63.74.
Take a breath, B2C marketers — these are unprecedented times. Consider taking these actions in the short term:
- Adjust marketing scenario plans NOW to build in existing economic and consumer behaviors. Scenario plans are usually developed on past consumer behavior, economic factors, and marketing cost data, so any built without consideration of a pandemic in place will be misleading. Build new scenarios that omit areas where products aren’t available or where consumers have a “shelter in place” mandate from the state. And update existing scenarios with the latest economic indicators, such as GDP, employment rates, and income indicators. Data changes will ensure that you are safeguarding your marketing investments as much as possible.
- Cut lower-funnel marketing initiatives. A full focus on driving sales conversion — through promotional offers, call-to-action messages, or direct marketing — is tone-deaf. Consumers are dealing with major disruptions: They are stuck at home, have lost or are worried about losing their jobs, and must manage children mandated to stay at home. Review creative now, and consider reassuring marketing messaging so you sound less opportunistic and more empathetic.
- Invest in amplifying your brand, not sales conversions. Nielsen reported a 60% increase in the amount of content consumers watched this past week. To keep a baseline message in the market, maintain television, digital, social, and video advertising. At the same time, divest in advertising efforts that drive in-store foot traffic, like digital and traditional out-of-home (OOH) and radio. Once you’ve adjusted to this new and hopefully temporary normal, consider moving some promotional dollars into upper-funnel advertising initiatives to increase brand awareness and consideration or to reassure customers that you value their business and that you’re here for them in these uncertain times.
The next few weeks and months are going to impact marketing strategy and planning drastically. The Forrester B2C marketing team will provide more updates and best practices for marketers navigating through these uncharted waters. In the meantime, we’d be grateful to hear from you about how your brand’s marketing strategy is changing as a result of the pandemic. Please set up an inquiry with Jim Nail or me to share your challenges and/or the best practices you’re applying right now.